Oil prices sink on inflation fears, sending Canadian crude prices tumbling to new lows
Today's energy market action:
Rising rates, inflation fears and a tepid Q3 earnings outlook spooked global equity markets today, taking oil prices and most commodities lower. The TSX declined 2.1% while the S&P 500 fell 3.3%, as investors shifted into defensive mode. Short term bond yields (1-year) rose again today, hitting a 10-year high of 2.67%.
Hurricane Michael has now taken 720,000 bbl/day of oil and 812 MMcf/day of natural gas offline, as it moved into Florida today. Onshore refineries in the USGC were not affected by the massive storm, but several offloading marine terminals ceased operations for the day. Over the past three days, 1.7 million barrels of crude has been shut-in.
The American Petroleum Institute is forecasting a 9.75 million barrel build in US crude inventories. Official numbers from the EIA are due to be released tomorrow morning.
Brent and WTI both sank over 2% today, but Canadian crude prices took a much bigger hit as discounts continue to widen. Canadian Light fell 7%, falling to a 52-week low. WCS tanked 9%, falling below US$30 for the first time in almost two years.
Today's market movers:
Parkland Fuel (PKI.TO +5.0%) acquired a 75% stake in privately-held SOL Investments for $1.6 billion, expanding its footprint in the US Gulf Coast, Atlantic region and Caribbean. The deal will see the addition of 526 retail gas stations. The company will also retain the option to buy the remaining 25% at a pre-determined price. PKI hit an record high during the day.
Obsidian Energy (OBE.TO -1.7%) says it's on track to deliver "meaningful 2019 light oil production growth" from its Willesden Green Cardium program, which should result in “competitive economic returns." The company will hold its Investor Day meeting on November 15, 2018.
Secure Energy Services (SES.TO -3.8%) announced the start-up of its light oil feeder pipeline system and receipt terminal in the Kindersley-Kerrobert region of Saskatchewan. The company says the project was delivered on time and on budget.
International Petroleum (IPCO.TO -12.8%) has agreed to acquire BlackPearl Resources (PXX.TO +8.5%) in an all-stock transaction priced at $1.85 a share. PXX shareholders will receive 0.22 IPC shares for each share they own. IPC is a subsidiary of Lundin Group.
A consortium led by Talos Energy (TALO -4.0%) is looking to partner with state-owned Pemex to potentially develop the offshore Zama project, estimated to hold as much as 2 billion barrels of oil.
Goldman Sachs added Kinder Morgan (KMI -3.1%) to its Conviction Buy List with a price target of US$24.
|CURRENCIES & YIELDS|
TSX ENERGY SUB-SECTORS|
SPX ENERGY SUB-SECTORS|
|Imperial Oil||IMO||42.83||▼-2.9||33.43||44.91||94||D W|
|Husky Energy||HSE||20.45||▼-2.8||15.09||22.99||84||D W|
|Pembina Pipeline||PPL||44.11||▼-2.6||37.60||47.84||87||D W|
|Inter Pipeline||IPL||21.99||▼-1.4||21.36||27.92||30||D W|
|Gibson Energy||GEI||21.18||▼-1.5||15.68||21.64||97↑||D W|
|LARGE CAP E&P|
|Cdn Natural Res||CNQ||39.12||▼-3.0||36.88||49.08||19||D W|
|Cenovus Energy||CVE||12.11||▼-5.8||9.03||14.84||45||D W|
|Seven Generations||VII||15.85||▼-3.7||13.62||21.25||61||D W|
|Pason Systems||PSI||20.82||▼-0.1||16.05||22.10||93↑||D W|
|Mullen Group||MTL||15.17||▼-2.5||14.10||17.12||63||D W|
|Secure Energy||SES||8.34||▼-3.8||6.98||9.82||86||D W|
|REFINING & MARKETING|
|Parkland Fuel||PKI||44.30||▲5.0||23.41||45.49||98||D W|
|Exxon Mobil||XOM||84.52||▼-2.3||72.16||89.30||82||D W|
|Kinder Morgan||KMI||18.00||▼-3.0||14.69||19.83||87||D W|
|Williams Co||WMB||27.20||▼-1.6||24.00||33.67||59||D W|
|LARGE CAP E&P|
|EOG Resources||EOG||126.47||▼-4.4||95.36||133.53||92||D W|
|Occidental Petroleum||OXY||77.92||▼-5.2||62.47||87.67||67||D W|
|Anadarko Petroleum||APC||68.00||▼-3.7||46.75||76.70||85||D W|
|Concho Resources||CXO||153.16||▼-4.3||123.63||163.11||81||D W|
|National-Oilwell Varco||NOV||42.87||▼-5.7||31.47||49.08||61||D W|
|Baker Hughes||BHGE||31.92||▼-2.2||25.53||37.76||46||D W|
|Phillips 66||PSX||113.05||▼-3.9||89.14||123.97||76||D W|
|Valero Energy||VLO||110.84||▼-4.2||75.84||126.98||70↓||D W|
|Marathon Petroleum||MPC||80.65||▼-3.7||55.68||88.45||77||D W|
UPDATED: DAILY (END-OF-DAY)
• OIL PRICES REFLECT NEAR MONTH CONTRACT FROM THE NYMEX/CME GROUP
• EQUITY PRICES PROVIDED BY NYSE & TMX GROUP
• CHARTPACKS COURTESY STOCKCHARTS.COM
• OIL PRICES, FUTURES AND DIFFERENTIALS IN USD/BBL
• C5+ = EDMONTON CONDENSATE
• FUTURES CURVES SHOW PRICES FOR NEAR-MONTH CONTRACT (C1) AND NEXT 5-MONTHS (C2-C6)
• TSX SHARE PRICES IN CAD; S&P 500 PRICES IN USD
• ADR: AMERICAN DEPOSITORY RECEIPTS LISTED ON NYSE IN USD
• SHARE PRICE CHANGES (INCL. NEW HIGHS & LOWS) EXCLUDE DIVIDENDS
• BASED ON STOCKCHARTS TECHNICAL RANK (SCTR)
• REFLECTS RELATIVE STRENGTH AMONG OTHER ENERGY STOCKS (PERCENTILE RANKING)
• RISING RANK (↑) REFLECTS INCREASING RELATIVE STRENGTH
• FALLING RANK (↓) REFLECTS DECREASING RELATIVE STRENGTH.